New Antitrust Complaint Filed Against Microsoft

jimboid and others wrote in about a new antitrust complaint filed against Microsoft in the European Union, concerning Windows XP (all previous litigation has concerned earlier versions of Windows). The BBC and Sydney Morning Herald have articles about the complaint.

Comments

The nice thing is...

[James_Duncan8181]

That Mario Monti has the power to examine all complaints made *as a whole* rather then being limited to only those made at the start of the process. This judicial effectiveness is why the EU will not always be stuck playing catch-up with MS, unlike the US. In addition, the political climate in Brussels is a lot less favorable for MS (think Reno rather then Ashcroft) and the EU has previously made several rulings agains MS Passport etc.

Could be good. ;)

Another take

[Anonymous Coward]

See The Register for another take on the matter.

Key Facts, Acrobat Free

[Anonymous Coward]

CCIA COMPLAINT AGAINST MICROSOFT
KEY FACTS

When: CCIA's complaint was formally filed with the European Commission Directorate General
for Competition on 31 January 2003.

Background: The Windows desktop operating system is installed on over 93% of personal
computers in Europe and worldwide. Microsoft has held a dominant position on this market
position for the past decade. Microsoft also has a monopoly in the market for personal productivity
applications (word processors, spread sheets, etc) and the market for Internet browsing software.

Microsoft's behaviour in the market has been the subject of ongoing competition scrutiny since
1991. Its behaviour has resulted in both an "undertaking" with the European Commission in 1994
and a unanimous liability finding by the United States Court of Appeals for the District of Columbia in 2001.

Microsoft has systematically and deliberately engaged in illegal practices designed both to protect its Windows monopoly and leverage it into adjacent software markets. Microsoft has used its market power to eliminate competition and stifle innovation in market after market. Unprecedented in modern commerce, Microsoft's monopolies generate margins in excess of 80 percent and profits in excess of US$1 billion per month.

Microsoft's well-documented anticompetitive campaign against Netscape's Navigator web browser
and Sun's Java programming language has resulted in a new monopoly in Internet browsing
software, and sets the stage for the current CCIA complaint.

Focus of the Complaint: The latest version of Windows XP takes Microsoft's abusive practices to
a new level, illegally protecting Microsoft's existing monopolies and is illegally eliminating
competition in new software and service markets. This complaint seeks the intervention of the
European Commission to put an end to the multiple forms of abuse inherent in Windows XP.

The 260-page complaint comprises an exhaustive factual and legal basis for Commission action,
documenting multiple ways in which Windows XP violates Article 82 of the EC Treaty prohibiting
abuse of a dominant position. These abuses include:

Explorer, Outlook Express, Windows Media Player, Windows Messenger, and Windows Movie
Maker 2;
Biasing the user interface and operation of Windows XP to significantly advantage Microsoft's
own software and services over competitive offerings;
Refusing to fully disclose the document formats for the programs in Microsoft's Office suite of
applications, in order to reinforce the "applications barrier to entry;"
Imposing proprietary technologies, formats and protocols in Microsoft's dominant products with
the effect of excluding competition on the merits;
Imposing abusive licensing and other exclusionary practices vis-à-vis personal computer makers
to foreclose the most important distribution channel from competing products;
Leveraging dominant positions to distort competition in markets for e-mail and collaboration
server software;
Leveraging existing dominant positions to the markets for handheld computing devices and
smart phone software through bundling, failure to supply interface information, and the use of
proprietary formats and protocols.

Legal basis of complaint: The facts alleged in the CCIA complaint rest squarely within Article 82 of
the EC Treaty.

Article 82 imposes on dominant market players a special responsibility not to allow their
conduct to impair genuine undistorted competition on the common market, and prohibits such
firms from limiting markets, production or technical development to the detriment of consumers.
Microsoft uses methods other than those falling within the scope of competition on the merits to
eliminate competitors and thereby strengthen its multiple positions of superdominance. For
example, Microsoft's bundling in Windows XP squarely falls within Article 82's prohibition on
tying, foreclosing competition for the bundled Microsoft products, and leveraging Microsoft's
market power into new markets. The Court of First Instance of the European Union recently
reaffirmed the illegality of such behaviour in its Tetra Laval decision.

Impact on Consumers: Microsoft's anticompetitive conduct with Windows XP directly impacts
consumers in multiple ways.

Fewer choices of software products and very limited differentiation among personal computer
offerings;
Less innovation in the critical software markets which Microsoft dominates;
Higher prices for Microsoft's software products than would otherwise occur in a competitive
market;
Rampant security breaches in Microsoft's core products resulting from the lack of market forces
to develop secure software;
Less privacy associated with the manner in which Microsoft biases its consumer services in
Windows XP.

Intersection with Current Case: This is a separate complaint. Actions taken by the Commission
pursuant to its existing Statement of Objections cannot address the unlawful conduct inherent in
Windows XP, which include new abuses intended to extend its existing desktop monopolies.